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On the question insurers are asking, UAW’s Mercedes vote, and childhood asthma
Current conditions: Flooding killed nearly 100 people in Afghanistan over the weekend • Streets turned into rivers in southern Germany after heavy rain • It’s 110 degrees Fahrenheit in Delhi today, and the rest of the week will be hotter.
Hail damage accounted for between 50% and 80% of the $64 billion in insured storm costs worldwide last year, according to international reinsurance firm Swiss Re. As storms become more frequent and more severe due to climate change, insurers are beginning to factor hail into their risk assessments on policies, Bloombergreported. Such a move could result in higher rates for policyholders. Other customers could lose insurance altogether. Some insurers are “nervous to touch big solar farms” because of the incredible damage hail can do to solar panels. One insurer has started testing the durability of various panels by pummeling them with “industrially produced hail” and seeing how well they hold up.
Mercedes-Benz workers at a plant in Alabama voted last week against joining the United Auto Workers union. Just 2,045 workers out of about 5,000 voted in favor of unionizing, marking what Reuterscalled a “stinging loss” for the UAW, which has been pushing hard to expand membership across southern states after its contract deals with the Big Three in 2023. UAW also has its eyes on Tesla as a target for unionization. Last month the UAW found victory at a Volkswagen plant in Tennessee, where 73% of workers voted to unionize. But the results in Alabama are “a big setback,” explained NPR. Mercedes ran an aggressive anti-union campaign to convince workers to vote no, and Alabama politicians “framed the union vote as a threat to the state’s economic success.”
A new study suggests extreme heat is leading to more hospital visits for children who have asthma. The researchers had access to hospital admission data for young asthma patients within the University of California, San Francisco Benioff Children’s Hospitals. They looked at whether the children who were admitted lived in an area that was experiencing a heat wave when they got sick, and found that “daytime heat waves were significantly associated with 19% higher odds of children’s asthma hospital visits, and longer duration of heat waves doubled the odds of hospital visits.” More than 4.5 million children have the lung condition in the U.S.
A report from The Washington Post confirms what many drivers of electric vehicles probably already know: Public charging infrastructure in the U.S. isn’t growing fast enough. For every public charging point in the country, there are more than 20 EVs. Compare that to 2016, when there were seven EVs for each charging point, and it becomes clear charger installations aren’t matching growing demand. “As Americans purchase more and more EVs, public chargers will be essential to support long road trips, help apartment-dwellers go electric and alleviate overnight pressure on electricity grids,” the Post reported. President Biden has a goal of installing half a million charging stations by 2030 and the Bipartisan Infrastructure Law allocated $5 billion for states to kickstart that effort, but as of March, only seven stations had been built in four states as a result of the program.
First Solar recently became the world’s most valuable solar company, Bloombergreported. This is the first time in six years a U.S. firm has claimed the position over Chinese rivals. Stock gains on Friday helped the company overtake Sungrow Power Supply, which saw its shares fall at the same time. First Solar is the biggest U.S. manufacturer of solar panels. While its valuation is up, and U.S. solar firms will get a boost from higher tariffs on Chinese clean tech goods, “by most other metrics, including the vital one of being able to produce enough clean energy to fight climate change, First Solar still has a way to go to catch up with its Chinese counterparts,” Bloomberg said.
“The chances of politicians acting swiftly are probably better than they have been in the past. Not because of new scientific findings, but because solar, wind, and batteries have become so cheap so fast that the amount of pain involved in the transition to clean energy is far less than it would have been a decade ago. We could actually do this.” –Bill McKibben on remaining optimistic, even as the goal of limiting warming to 1.5 degrees Celsius seems further out of reach.
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For now at least, USAID’s future looks — literally — dark.
Elon Musk has put the U.S. Agency for International Development through the woodchipper of his de facto department this week in the name of “efficiency.” The move — which began with a Day One executive order by President Trump demanding a review of all U.S. foreign aid that was subsequently handed off to Musk’s Department of Government Efficiency — has resulted in the layoff or furloughing of hundreds of USAID employees, as well as imperiled the health of babies and toddlers receiving medical care in Sudan, the operations of independent media outlets working in or near despotic regimes, and longtime AIDS and malaria prevention campaigns credited with saving some 35 million lives. (The State Department, which has assumed control of the formerly independent agency, has since announced a “confounding waiver process … [to] get lifesaving programs back online,” ProPublica reports.) Chaos and panic reign among USAID employees and the agency’s partner organizations around the globe.
The alarming shifts have also cast enormous uncertainty over the future of USAID’s many clean energy programs, threatening to leave U.S. allies quite literally in the dark. “There are other sources of foreign assistance — the State Department and the Defense Department have different programs — but USAID, this is what they do,” Tom Ellison, the deputy director for the Center for Climate and Security, a nonpartisan think tank, told me. “It is central and not easily replaced.”
In addition to “saving and improving lives around the world in an altruistic sense,” USAID has “a lot of benefits for U.S. national interests and national security,” Ellison went on. Though USAID dates back to the Cold War, its Power Africa initiative launched under President Barack Obama in 2013, and energy investment projects around the world followed. Of its $42.8 billion budget request for 2025, the agency had earmarked $4.1 billion for global infrastructure and investment programs, including energy security and excluding its additional targeted energy investment in Ukraine.
Some of these benefits are immediate and obvious. For example, USAID invested $422 million in new energy infrastructure in Ukraine, including more than a thousand generators and a solar and battery storage project, all to brace against Russia’s weaponized flow of fossil fuels. (USAID was also reviewing the deployment of Musk’s Starlink Satellite Terminals to the Ukrainian government prior to his gutting of the agency, per The Lever.)
But USAID is in the power business for other strategic reasons, too. USAID initiatives such as assisting Georgia and Kosovo in running their first renewable energy auctions help to secure energy stability and independence among countries where Russia is trying to gain sway. By the same token, rural electrification efforts in Africa help the U.S. remain a leader on the continent even as China is looking to make inroads. “China’s infrastructure and assistance programs around the world, like the Belt and Road Initiative — they consider that very explicitly a lever to peel U.S. allies away,” Ellison said. “Russian propagandists are already cheering the potential shutdown of USAID or a cut to their programs, for those reasons.”
Likewise, USAID has also rolled out energy projects in Indonesia, helping to deploy rooftop solar plants at airports and investing $200 million into a geothermal plant and two hydropower plants. Such efforts in the Indo-Pacific “pay dividends in strengthening relationships with allies and partners critical to that competition with China,” the Council on Strategic Risks, the parent institute of the Center for Climate and Security, wrote in a memo Tuesday.
That’s part of what makes the USAID whiplash so severe. Not only is the concern and uncertainty of the agency’s shutdown in complete opposition to the administration’s purported goal of “efficiency,” but Trump’s knee-jerk reaction to anything that suggests the idea of a U.S. handout — much less one that includes programs explicitly addressing “climate change” — runs counter to his stated goals of protecting U.S. troops and national security interests. USAID programs “are very cost-effective investments in terms of being a cent or less on the U.S. taxpayer dollars,” Ellison told me. “They’re paying for themselves over and over again in terms of humanitarian or military spending averted in the future.”
The American Clean Power Association wrote to its members about federal guidance that has been “widely variable and changing quickly.”
Chaos within the Trump administration has all but paralyzed environmental permitting decisions on solar and wind projects in crucial government offices, including sign-offs needed for projects on private lands.
According to an internal memo issued by the American Clean Power Association, the renewables trade association that represents the largest U.S. solar and wind developers, Trump’s Day One executive order putting a 60-day freeze on final decisions for renewable energy projects on federal lands has also ground key pre-decisional work in government offices responsible for wetlands and species protection to a halt. Renewables developers and their representatives in Washington have pressed the government for answers, yet received inconsistent information on its approach to renewables permitting that varies between lower level regional offices.
In other words, despite years of the Republican Party inching slowly toward “all of the above” energy and climate rhetoric that seemed to leave room for renewables, solar and wind developers have so far found themselves at times shut out of the second Trump administration.
ACP’s memo, which is dated February 3 and was sent to its members, states that companies are facing major challenges getting specific sign-offs and guidance from the Army Corps of Engineers, which handles wetlands permits, as well as the Fish and Wildlife Service, our nation’s primary office for endangered species and migratory bird regulation.
Federal environmental protection laws require that large construction projects — even those on state and private lands — seek direction from these agencies before building can commence. Wetlands permitting has long been the job of the Army Corps, which determines whether particularly wet areas are protected under the Clean Water Act. Wetlands have historically been a vector for opponents of large pipelines and mines, as such areas are often co-located with sensitive ecosystems that activists want to preserve.
Fish and Wildlife, meanwhile, often must weigh in on development far from federal acreage because, according to the agency, two-thirds of federally listed species have at least some habitat on private land. FWS also handles the conservation of bird species that migrate between the U.S. and Canada, which are protected under the Migratory Bird Treaty Act. Any changes to federal bird consultation could impact wind developers because turbine blades can kill birds.
Now, apparently, all those important decision-makers are getting harder to read — or even reach. Army Corps district activity has become “widely variable” and is “changing quickly,” per the memo, with at least two districts indicating that for “wind or solar projects” they “will not be issuing any JDs,” meaning jurisdictional determinations for federally protected wetlands — that is, they won’t even say whether federal wetlands are present at a construction site or not. According to the Army Corps, receiving a JD is optional, but it is nevertheless an essential tool for developers trying to avoid future legal problems in the permitting process.
In addition, emails from staff in FWS’ migratory birds protection office now apparently include a “boilerplate notice” that says the office “is unable to communicate with wind facilities regarding permitting at this time.”
Usually, renewables developers just get a simple go-ahead from the government saying that they don’t have wetlands or bird nests present and that therefore work can begin. Or maybe they do have one of those features at the construction site, so guardrails need to be put in place. Either way, this is supposed to be routine stuff unless a project is controversial, like the Keystone XL pipeline or Pebble Mine in Alaska.
It’s not immediately clear how solar and wind developers move forward in this situation if they are building in areas where wetlands or protected species even may be present. Violating wetlands and species protection laws carries legal penalties, and with the Trump administration arranging itself in such an openly hostile fashion against renewables developers, it’s probably not a good idea to break those laws.
Unfortunately for industry, the ACP memo describes a confusing state of affairs. “Written guidance from ACOE [Army Corps of Engineers] to industry has been expected but members have not seen it yet. Actions and communications from regional districts appear to be guided by internal ACOE emails,” the document states. Staffing within the Army Corps is “uncertain” due to questions over whether money from the Inflation Reduction Act — which provided funds to hire permitting personnel — will be “available to continue funding staff positions in some offices,” or whether permitting staff will take the administration’s voluntary resignation offer, which the memo claims “is apparently still actively being pushed on staff with emails.”
Meanwhile, at Fish and Wildlife, ACP’s members “have indicated some staff are still taking phone calls and responding to emails to answer questions, while others are not.”
As with a lot happening in the early era of Trump 2.0, much of the permitting mess is still unclear. We don’t know who is behind these difficulties because there have been no public policy or guidance changes from the Army Corps or Fish and Wildlife. Trump did order agencies to stop issuing “new or renewed approvals” for wind projects shortly after entering office, but the ACP memo describes something altogether different: agency staff potentially refusing to declare whether an approval is even necessary to build on state or private lands.
Another example of how confusing this is? Interior had issued a 60-day pause on final decisions for solar projects, but the Army Corps isn’t under Interior’s control — it’s part of the Defense Department.
It’s also unclear if the contagion of permitting confusion has spread to other agencies, such as the Federal Aviation Administration, which we previously reported must regularly weigh in on wind turbines for aviation safety purposes. As I reported before Inauguration Day, anti-wind activists urged the Trump administration to essentially weaponize environmental laws against wind energy projects.
ACP didn’t respond to a request for comment. I also reached out to the Army Corps of Engineers and Fish and Wildlife Service, so I’ll let you know if and when I hear back from any of them.
It took the market about a week to catch up to the fact that the Chinese artificial intelligence firm DeepSeek had released an open-source AI model that rivaled those from prominent U.S. companies such as OpenAI and Anthropic — and that, most importantly, it had managed to do so much more cheaply and efficiently than its domestic competitors. The news cratered not only tech stocks such as Nvidia, but energy stocks, as well, leading to assumptions that investors thought more-energy efficient AI would reduce energy demand in the sector overall.
But will it really? While some in climate world assumed the same and celebrated the seemingly good news, many venture capitalists, AI proponents, and analysts quickly arrived at essentially the opposite conclusion — that cheaper AI will only lead to greater demand for AI. The resulting unfettered proliferation of the technology across a wide array of industries could thus negate the energy efficiency gains, ultimately leading to a substantial net increase in data center power demand overall.
“With cost destruction comes proliferation,” Susan Su, a climate investor at the venture capital firm Toba Capital, told me. “Plus the fact that it’s open source, I think, is a really, really big deal. It puts the power to expand and to deploy and to proliferate into billions of hands.”
If you’ve seen lots of chitchat about Jevons paradox of late, that’s basically what this line of thinking boils down to. After Microsoft’s CEO Satya Nadella responded to DeepSeek mania by posting the Wikipedia page for this 19th century economic theory on X, many (myself included) got a quick crash course on its origins. The idea is that as technical efficiencies of the Victorian era made burning coal cheaper, demand for — and thus consumption of — coal actually increased.
While this is a distinct possibility in the AI space, it’s by no means a guarantee. “This is very much, I think, an open question,“ energy expert Nat Bullard told me, with regards to whether DeepSeek-type models will spur a reduction or increase in energy demand. “I sort of lean in both directions at once.” Formerly the chief content officer at BloombergNEF and current co-founder of the AI startup Halcyon, a search and information platform for energy professionals, Bullard is personally excited for the greater efficiencies and optionality that new AI models can bring to his business.
But he warns that just because DeepSeek was cheap to train — the company claims it cost about $5.5 million, while domestic models cost hundreds of millions or even billions — doesn’t mean that it’s cheap or energy-efficient to operate. “Training more efficiently does not necessarily mean that you can run it that much more efficiently,” Bullard told me. When a large language model answers a question or provides any type of output, it’s said to be making an “inference.” And as Bullard explains, “That may mean, as we move into an era of more and more inference and not just training, then the [energy] impacts could be rather muted.”
DeepSeek-R1, the name for the model that caused the investor freakout, is also a newer type of LLM that uses more energy in general. Up until literally a few days ago, when OpenAI released o3-mini for free, most casual users were probably interacting with so-called “pretrained” AI models. Fed on gobs of internet text, these LLMs spit out answers based primarily on prediction and pattern recognition. DeepSeek released a model like this, called V3, in September. But last year, more advanced “reasoning” models, which can “think,” in some sense, started blowing up. These models — which include o3-mini, the latest version of Anthropic’s Claude, and the now infamous DeepSeek-R1 — have the ability to try out different strategies to arrive at the correct answer, recognize their mistakes, and improve their outputs, allowing for significant advancements in areas such as math and coding.
But all that artificial reasoning eats up a lot of energy. As Sasha Luccioni, the AI and climate lead at Hugging Face, which makes an open-source platform for AI projects, wrote on LinkedIn, “To set things clear about DeepSeek + sustainability: (it seems that) training is much shorter/cheaper/more efficient than traditional LLMs, *but* inference is longer/more expensive/less efficient because of the chain of thought aspect.” Chain of thought refers to the reasoning process these newer models undertake. Luccioni wrote that she’s currently working to evaluate the energy efficiency of both the DeepSeek V3 and R1 models.
Another factor that could influence energy demand is how fast domestic companies respond to the DeepSeek breakthrough with their own new and improved models. Amy Francetic, co-founder at Buoyant Ventures, doesn’t think we’ll have to wait long. “One effect of DeepSeek is that it will highly motivate all of the large LLMs in the U.S. to go faster,” she told me. And because a lot of the big players are fundamentally constrained by energy availability, she’s crossing her fingers that this means they’ll work smarter, not harder. “Hopefully it causes them to find these similar efficiencies rather than just, you know, pouring more gasoline into a less fuel-efficient vehicle.”
In her recent Substack post, Su described three possible futures when it comes to AI’s role in the clean energy transition. The ideal is that AI demand scales slowly enough that nuclear and renewables scale with it. The least hopeful is that immediate, exponential growth in AI demand leads to a similar expansion of fossil fuels, locking in new dirty infrastructure for decades. “I think that's already been happening,” Su told me. And then there’s the techno-optimist scenario, linked to figures like Sam Altman, which Su doesn’t put much stock in — that AI “drives the energy revolution” by helping to create new energy technologies and efficiencies that more than offset the attendant increase in energy demand.
Which scenario predominates could also depend upon whether greater efficiencies, combined with the adoption of AI by smaller, more shallow-pocketed companies, leads to a change in the scale of data centers. “There’s going to be a lot more people using AI. So maybe that means we don’t need these huge, gigawatt data centers. Maybe we need a lot more smaller, megawatt-size data centers,” Laura Katzman, a principal at Buoyant Ventures, told me. Katzman has conducted research for the firm on data center decarbonization.
Smaller data centers with a subsequently smaller energy footprint could pair well with renewable-powered microgrids, which are less practical and economically feasible for hyperscalers. That could be a big win for solar and wind plus battery storage, Katzman explained, but a boondoggle for companies such as Microsoft, which has famously committed to re-opening Pennsylvania’s Three Mile Island nuclear plant to power its data centers. “Because of DeepSeek, the expected price of compute probably doesn’t justify now turning back on some of these nuclear plants, or these other high-cost energy sources,” Katzman told me.
Lastly, it remains to be seen what nascent applications cheaper models will open up. “If somebody, say, in the Philippines or Vietnam has an interest in applying this to their own decarbonization challenge, what would they come up with?” Bullard pondered. “I don’t yet know what people would do with greater capability and lower costs and a different set of problems to solve for. And that’s really exciting to me.”
But even if the AI pessimists are right, and these newer models don’t make AI ubiquitously useful for applications from new drug discovery to easier regulatory filing, Su told me that in a certain sense, it doesn't matter much. “If there was a possibility that somebody had this type of power, and you could have it too, would you sit on the couch? Or would you arms race them? I think that is going to drive energy demand, irrespective of end utility.”
As Su told me, “I do not think there’s actually a saturation point for this.”